Competition For Nursing Home Workers Hits An All-Time High

May 31, 2021, Paul Bergeron, Skilled Nursing News - The most agonizing struggle to find and retain operational staff at skilled nursing facilities continues to be a condition in search of a cure.  The pandemic worsened the situation, magnifying concerns about health and safety, which were then piled onto already low wages and relatively uncompetitive pay.

Hero pay has been a nice gesture, but not a solution.  Employees can be had through agencies, but at steeper costs.  As one recruiter for a national skilled nursing facility said, “Why work for $15 per hour cleaning up for a resident with incontinence when you can make the same at a McDonald’s or retail store?”

Morale at some communities has been sinking as conditions worsened, although onsite hygiene has improved steadily in recent months.  Even still, the vaccine has not proved to be a cure-all because uptake rates for employees have been lower than hoped.

The good-hearted worker will persist, but troubling turnover rates cannot be ignored.  One-third of health care workers said they’ve considering leaving the industry, according to a Washington Post-Kaiser Family Foundation poll in April. 

“It’s hard work, you are always on your feet, and it’s a stressful workplace,” said the recruiter, who hires for a large, national operator.  “On top of that, you add ‘endanger my life by working here’ because of Covid-19.  These skilled nursing employees tend to last two or three years on average before burning out.”

Why ‘We Can’t’ Raise Wages

Operators today will say they can’t raise wages because they are just trying to survive economically during these tough times during the past year or so, the recruiter said.

When asking supervisors or the HR team about raising wages, the recruiter said management often tells him and others that they can’t afford to because they didn’t budget for it.

“But really, they are not budgeting for it because it’s adding expense in the budget,” he said.

Another reason they can’t or won’t budge is because others at the facility are paid more, such as RNs, who sometimes earn four times that of low-paid staff – and yet these two (employee types) are working hand-in-hand, he said.

“That’s the difference between having a four-year degree and taking a two-week training course, I guess,” he said.  “If we paid staff based on how essential they are to the day-to-day operation, we’d have an entirely different pay scale.”

In some markets, RNs and LNs, can make 50 percent more in salary by working in the protected ICU at hospitals, said Mark Myers, Managing Director, Investment Sales, Walker & Dunlop.

“Furthermore, the continuing migration South by older citizens – as well as the workforce – to low-tax, no-tax, warmer, pro-business environments is affecting occupancy and hiring in states like Illinois, which has seen 70,000 people leave.”

When Smaller is Better

Betsy Rust, Partner, Plante & Moran, acknowledged, as do all, that resident-care workers play a critical role in the industry.

“Communities that have strong brands and consumer confidence, and strong company culture where they truly take care of their workers are at an advantage,” she said.  “These workers, remember, are mentally and physically exhausted by all of this the past year.

“It’s just much harder for larger companies to build a ‘we care’ kind of attitude company-wide compared to small or even some mid-sized operators.  Competition for workers is at an all-time high.”

Rust said another advantage for smaller, local companies is that they are better at connecting in the community and driving referrals from nearby hospitals, for example.

“Smaller communities don’t need to operate in an Amazon-like manner,” she said.  “But what hurts smaller companies economically is their inability to operate with economies of scale.”

The market dictates pay rates and rents in the industry’s private sector.  But for Medicaid, it comes down the rates a state will pay skilled nursing operators.  “So even if you are a good, well-run company with a great culture, you’ll be paid the same as the other community down the block,” Myers said.

Treating Them Like ‘Royalty’

David Dillard, FAIA, Senior Living Practice Leader, Principal, DKS, Dallas, said architectural designs lately have been making employees’ accommodations safer and a bit swankier, which could help to make these jobs more attractive.

Dillard said back-room breakrooms are being designed a bit cushier – “there are balconies; and really, these workers are being treated like royalty compared to the past,” he said.

“[Designs are being drawn] with more separation for the inbound and outbound employees so they can do their wellness check-points more safely when coming and going from work,” he said.  “The goal is to make as many things in the process ‘touchless’ as possible.”

That’s important, because the recruiter said, “When I’m speaking to candidates, they will ask if PPE will be provided.  Having it wasn’t a guarantee early on in the pandemic, but now it’s plentiful (although less required).  So yes, it will be available.  But they’ve heard the horror stories and some won’t believe you even when you tell them.”

“Unfortunately, they aren’t looking at how the pandemic has shed a brighter light on wages,” he said.  “Coming out of the past year’s economic turmoil, they learned something, but they aren’t trying to fix it.  They could have changed their outlook, and used it as an opportunity to better pay these valuable, hard-to-find employees.”